Monday, October 20, 2008

Will P & G kill the golden goose?

So a little blurb in the Financial Times this past Sunday could have a HUGE impact on marketing in general. The direct marketing industry side elbowing in on the retail side. Usually it is the other way around. The article noted that "Procter and Gamble is testing its ability to use the internet to sell its toothpaste, household cleaners and nappies directly to US households, in a potential long-term strategic challenge to its retail partners.

The company is supporting a website, theEssentials.com, that is exclusively selling its brands, with items such as single tubes of Crest toothpaste and bottles of Mr Clean cleaning fluid, to boxes of its Pampers and Luvs brand nappies and Gillette razors.

In an indication of the sensitivities involved, the site is being operated by a third party, which owns the inventory. “We treat them like any other retailer as they buy product directly from us,” said Paul Fox, a company spokesman, of the site, which is still covered by P&G’s legal terms and conditions.'

To read the article you can go to:
http://www.ft.com/cms/s/0/04c83c2c-9e16-11dd-bdde-000077b07658.html?nclick_check=1

Potentially the retail model being blown up is the most significant marketing development of 2009. Allowing consumers to buy P & G products directly has two major advantages to both parties. P & G not paying tribute to the retailer being one and less expensive pricing (dare we think that is possible?) being the other.

As a tried and true direct marketer I am excited and intrigued by the possibilites. Customers having the choice on buying the product through their desired channel is something to CHEER about (sorry I could not resist that P & G brand plug).

Fear not oh ye retailer, you will not be made obsolete as people will still shop in your store to buy products. But this could truly be the DAWN of a new ERA (sorry folks sometimes these things just write themselves!)

What do you think?